Using the Government to Restrict Supply to Drive Up Your Wages: The Scam of 'Public Interest'

The Wall Street Journal reports on rent-seeking gone wild:

Imagine you were a state legislator and some folks asked you to pass a law making it a crime to give advice about paint colors and throw pillows without a license. And imagine they told you that the only people qualified to place large pieces of furniture in a room are those who have gotten a college degree in interior design, completed a two-year apprenticeship, and passed a national licensing exam. And by the way, it is criminally misleading for people who practice interior design to use that term without government permission.

You might stare at them incredulously for a moment, then look down at your calendar and say, "Oh, I get it -- April Fool!" Right? Wrong.

These folks represent the American Society of Interior Designers (ASID), an industry group whose members have waged a 30-year, multimillion-dollar lobbying campaign to legislate their competitors out of business. And those absurd restrictions on advice about paint selection, throw pillows and furniture placement represent the actual fruits of lobbying in places like Alabama, Nevada and Illinois, where ASID and its local affiliates have peddled their snake-oil mantra that "Every decision an interior designer makes affects life safety and quality of life."

Legislative analysis by a half-dozen states that rebuffed ASID's attempts to cartelize interior design -- including Colorado, Washington and South Carolina -- has failed to support ASID's claim that the location of your couch or the color of your bedroom walls is literally a matter of life and death. As the Colorado Department of Regulatory Agencies put it, there is "no evidence of physical or financial harm being caused to . . . consumers by the unregulated practice of interior designers."

Lacking any factual support for its sweeping public welfare claims, ASID and its supporters often resort to fear-mongering. For example, licensing proponents frequently say the tragic fire at the MGM Grand Hotel in Las Vegas that killed 87 people in 1980 was the result of inappropriate fixtures and furnishings.

The fire was actually caused by an electrical fault and allowed to spread by a grossly inadequate sprinkler system. Investigators later identified 83 different building code violations. Another favorite is the 2003 fire at The Station nightclub in Rhode Island, in which 100 people perished. Again, that tragedy had nothing to with substandard interior design services. It was caused by an illegal indoor fireworks display and the absence of a code-mandated sprinkler system.

If there were any credible evidence that unregulated interior design presents a genuine risk to consumers, ASID would certainly have found it by now. They have had plenty of time (more than three decades), resources (dues for ASID's 40,000 members average several hundred dollars per year), and incentive. Furthermore, despite ASID's best efforts, only three states regulate the practice of interior design. That leaves 47 (including California and New York) where the ravages of unlicensed interior design could be easily documented -- if there were any.

So what is really behind ASID's relentless push for more regulation? Simple: naked economic protectionism.

It is no accident that the credentials required for licensure in ASID-backed occupational licensing bills are the same credentials required for membership in ASID itself. This includes a four-year degree from an accredited interior design college, a two-year apprenticeship, and a two-day, thousand-dollar licensing exam so irrelevant to the actual practice of interior design that many ASID members have never bothered to pass it themselves and simply get a waiver instead.

In vetoing interior design legislation last May, Indiana Gov. Mitch Daniels explained that the "principal effect" of the law would have been "to restrain competition and limit new entrants into the occupation." Mr. Daniels noted that interior designers were "hardly the only profession" seeking government protection from potential competitors.

The numbers certainly bear him out. Fifty years ago, only 5% of the American workforce was licensed; today it is nearly 30%. We're not talking about brain surgeons or airline pilots, either. Louisiana requires florists to be licensed (yes, florists), and in several states -- including Louisiana, Oklahoma and Virginia -- only licensed funeral directors may sell caskets, a state-sanctioned monopoly they use to jack up prices anywhere from 400% to 600%, a fact established in litigation by the Institute for Justice in Tennessee and Oklahoma.

Until it was struck down by the state supreme court last year, Alabama's interior design law made it a crime to offer advice about throw pillows and paint colors without a license. To anyone who thinks that law -- or others like it currently being pushed by interest groups like ASID in state capitols around the nation -- was motivated by a genuine concern for public health and welfare, I can only say this: It's going to be a rough day.

Via LRC Blog